Many saw Toshiba's willingness to give up on HD DVD as a logical business decision and perhaps an admission of Blu-ray's superiority. However, there might be a little more to the story. Reuters reports that on Wednesday Toshiba and Sony Corporation, one of Blu-ray's principal developers, agreed to a major business deal, reached just after Toshiba made its final HD DVD decision.

Sony agreed to sell it microchip processing facilities in western Japan for approximately $835M USD. These facilities currently produce Cell processors and RSX graphic chips. Toshiba will enter the joint venture with Sony on April 1, 2008.

Toshiba, IBM and Sony were the principal developers of the Cell microprocessor, but Toshiba previously showed little interest in using the chip for any of its own projects. Sony touts the Cell broadband engine in its Playstation 3 consoles; IBM uses the Cell processor in high performance computing clusters. Toshiba has vowed to now use the Cell in its upcoming products.

While Toshiba and Sony entered into talks back in October 2007 and reached a tentative agreement to sell the cell facilities, the two companies continued to haggle about the price. Sony's concession of what is considered a favorable price for Toshiba will likely strike many following Toshiba's drop as HD DVD as more than a coincidence, and perhaps a sign of an informal agreement.

The other interesting aspect of the move is that it indicates a clear shift by Toshiba to back the PS3. The PS3, which last month outsold Microsoft's Xbox 360, previously had few ties to the company; while Microsoft's number one ally in hardware manufacturing has always been Toshiba. Toshiba manufacturers several components for the Xbox 360, including the HD DVD add-on, and the Microsoft Zune MP3 players.

Toshiba's flip-flop may have been in the cards for a while. Microsoft showed little remose as HD DVD took second place to Blu-ray; a move Toshiba must have recognized from its American ally. Now the solidified PS3 venture between Sony and Toshiba indicates that Toshiba now has switched to backing the PS3 almost exclusively, another victory for Sony.

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You know fellas what Microsoft is about, no need to remind. Quality was never their priority, as history shows, all they care about is PROFIT, thus you as the customer are not given the respect you deserve for the money you pay for their products. They hype and try to make a fan out of you, but only to drive their cause, not yours. Their software is bloatware full of bugs and security holes and crashes, with an occasional BSOD. Now their failure rate at sofware is a perfect match for the failure rate with the hardware they release (I'm talking about, of course, XBox360, - RROD, anyone?) BSOD, RROD - hell, MS is full of it. Japanese, on the other hand, take pride in the quality of the products they make, thus PS3 is enjoying the praise of its adopters. For what it's worth I always owned XBox and PS brands, but Sony always had my vote for quality. The only thing that sold me MS stuff is Halo, period.

..aha.. ;)From Wiki:Although once it was usually attributed to IBM, in the 1990s and later the term (Fear,Uncertainty,Doubt) became most often associated with industry giant Microsoft. Said Roger Irwin:[8]“ Microsoft soon picked up the art of FUD from IBM, and throughout the 80's used FUD as a primary marketing tool, much as IBM had in the previous decade. They ended up out FUD-ding IBM themselves during the OS2 vs Win3.1 years. ”

Although the Halloween documents (leaked internal Microsoft documents ) say that "OSS is long-term credible … [therefore] FUD tactics cannot be used to combat it."[9], in fact Open source (OSS) and the GNU/Linux community in particular are widely perceived as frequent targets of Microsoft FUD:

* Statements about the "viral nature"[10] of the GNU General Public License (GPL), * Statements that "...Linux infringes 235 Microsoft's patents..." before software patent law precedents were established.

P.S. It was a smart move by MS to acquire Bungie Studios because if they didn't I don't know one single game that would be driving the sales of their consoles as much as HALO did.

Since when does Bungie which is ONLY known for Halo in the console world constitute any type of quality? Forget the hype and fanboy based reviews giving the games 9.0+ scores. For a first person shooter it's below average in both playability and quality. The Graphics are pretty sad for a game supposed to be the pinnacle of console gaming. The storyline is predictible and bland. The hype made the game seem like something it turned out not to be.

My bad if I got it wrong about Bungie being owned by MS but it doesn't change the fact that Halo was the single major game driving XBox sales like nothing else. My point is still the same - MS, being the big and rich company, have quite a record of releasing low quality shit. MS has all the resources to be the best, but all they care is PROFITS and MONOPOLY. They'll spend more dough trying to monopolize smth. rather insuring the quality of the crap they make & shove everywhere. And we all know that Japanese take QUALITY of their products very personally. So, no wonder that while being a powerful machine in itself, XBox360 fails miserably in the quality department (I think it was so ironic when one of their pre-selected consoles had RROD at Game Developers Conference recently). If MS would address quality issues w/the products they make and try not to be as greedy as they are I would have no problem w/them.

Don't underestimate Sony. They are just as capable of releasing crap as Microsoft. And, if anything, they are more likely to lie about the specifications (not just in consumer stuff; even their high-end video equipment is known for "cutting some corners" and having misleading manuals & spec sheets).

"This is about the Internet. Everything on the Internet is encrypted. This is not a BlackBerry-only issue. If they can't deal with the Internet, they should shut it off." -- RIM co-CEO Michael Lazaridis